Terms of Reference of Human Resources and Terms of Reference of the Nomination

Remuneration Committee Committee

The Terms of Reference for the Human Resource and Remuneration The Terms of Reference for the Nomination Committee shall be as
Committee shall be as follows: follows:

1. Recommend to the board for consideration and approval of a
policy framework for determining remuneration of directors
(both executive and non-executive directors and members of
senior management). The definition of senior management
will be determined by the board which shall normally include
the first layer of management below the chief executive officer
level;
2. Undertaking annually a formal process of evaluation of
performance of the board as a whole and its committees either
directly or by engaging external independent consultant and
if so appointed, a statement to that effect shall be made in the
directors’ report disclosing name, qualifications and major
terms of appointment;
3. Recommending human resource management policies to the
board;
1. Responsible for considering and making recommendations to
the Board in respect of the Board committees and the
chairmanship of the Board committees.
2. Responsible for keeping the structure, size and composition of
the Board under regular review and for making
recommendations to the Board with regard to any changes
necessary.
3. Any other matter which is ancillary to the TOR mentioned
above.
In case of any conflict in the Terms of Reference of the Nomination
Committee with the terms of the Human Resource and
Remuneration Committee, the matter shall be referred to the Board
of Directors for decision.

4. Recommending to the board the selection, evaluation,

development, compensation (including retirement benefits)
of chief operating officer, chief financial officer, company
secretary and head of internal audit;

5. Consideration and approval on recommendations of chief

executive officer on such matters for key management
positions who report directly to chief executive officer or chief
operating officer; and

6. Where human resource and remuneration consultants are

appointed, their credentials shall be known by the committee
and a statement shall be made by them as to whether they
have any other connection with the company.

Siemens Annual Report 2018 19

 Sustainability at Siemens

20 Siemens Annual Report 2018

Sustainability at Siemens
Megatrends like climate change, urbanization, demographic
change, globalization and digitalization are stimulating
change in our world, all of which needs to be driven toward a
more sustainable future. The aim is to improve the prosperity
and quality of life of all people, while keeping within the
limits of the planet. To globally strive toward sustainable
development, 193 UN member states adopted the Agenda
2030 and its 17 Sustainable Development Goals (SDGs),
which came into effect in January 2016. The SDGs and
their related targets address the most important economic,
social, environmental and governance-related challenges
of our times and stimulate transformational change.
This requires governments, businesses, cities and civil
societies to contribute their fair share. As a global industrial
conglomerate with businesses along the energy value chain
and in the healthcare sector, Siemens is in a unique position
to touch on substantial business opportunities from several
trillion euros worth of investment per annum needed to
drive the UN Agenda 2030 toward the SDGs and related
targets. We are having an impact on most of the SDGs in
four important ways:
• through our products and solutions,
• by responsibly operating our business,
• through our expertise and thought leadership,
• and through our Corporate Citizenship activities programs, and we aim to become carbon neutral by
and community engagement
To us, being a sustainable business means ensuring profitable
and long-term growth while balancing profit, people and
planet. We believe that the SDGs are a responsibility, but
that they also offer new business opportunities to Siemens,
notably by opening doors for us to work with national
and local governments that want to reshape their own
development agenda. We hope to continue our collaboration
with them in such areas as energy and decarbonization,
transportation, infrastructure, industrial development,
urban development, healthcare, innovation, job creation,
education and the fight against corruption. Integrating the
perspective of Siemens’ contribution to the SDGs enriched
the assessment of the most important issues and facilitated
a well-informed materiality process.
Materiality Assessment
Analyzing our impact on the SDGs added a new perspective
on our assessment of the most important issues for Siemens
and confirmed our findings from the previous materiality
assessments. In the course of this assessment process, 12
principles emerged from regular dialogues with external
and internal stakeholders as they set priorities based on
their importance for Siemens and its stakeholders. These
principles are clustered under the three headings – profit,
people and planet – and reflect our ambition to contribute
to societies as well as develop new business opportunities
together with our customers:
Profit
• We contribute to the competitiveness of our customers
with our products, solutions, and services.
• We partner with our customers to identify and develop
sustainability-related business opportunities.
• We operate an efficient and resilient supply chain by
using a supplier code of conduct, risk management,
and capacity building.
• We take the initiative to work with our stakeholders
to manage project and reputational risks and identify
relevant business trends.
• We adhere to the highest compliance and anti-
corruption standards and promote integrity via the
Siemens Integrity Initiative, which fights corruption and
fraud through collective action, education and training.
Planet
• We help our customers increase energy efficiency, save
resources and reduce carbon emissions.
• We develop our products, solutions and services using
a lifecycle perspective and sound eco-design standards.
• We minimize the environmental impact of our
operations through environmental management
2030.
People
• We contribute to the sustainable development of
societies with our portfolio, local operations, and
thought leadership.
• We foster long-term relationships with local societies
through Corporate Citizenship projects with partners.
• We live a zero-harm culture and promote the health of
our employees.
• We live a culture of leadership based on common
values, an innovation mindset, people orientation and
diversity.
Siemens Annual Report 2018 21
 Corporate Citizenship

Corporate citizenship has been an integral part of Siemens from the very beginning. We strive to contribute to the sustain-
able development of the regions, in which we operate. Corporate citizenship is Siemens’ voluntary commitment to society
with the aim to advance societies by making our technology and knowledge accessible to more people around the world.
We strive to create shared value in every country, in which we operate while strengthening our business performance. We
build our commitment on three pillars: access to technology, access to education, and sustaining communities.

Ghulam Ishaq Khan Institute of Engineering Sciences and Technology (GIKI) – Eco-friendly car

Siemens sponsored a team of young engineers from GIKI, one of Pakistan’s top universities, to design and build an ultra-
efficient gasoline powered car. The team represented Pakistan at the Shell Eco-Marathon held in Singapore competing
against teams from across the globe.

Family Educational Services Foundation (FESF)

According to recent demographics in Pakistan, there are approximately 1.25 million children who are profoundly deaf and
cannot attend mainstream schools. Yet less than 2% of these children have the opportunity for an education!

Deaf Reach, a program of Family Educational Services Foundation, was established in 1995 to provide academic and voca-
tional education to deaf children and youth, particularly in rural areas, with little access to formal education or vocational
training.

Over 65% of Pakistan’s population lives in rural areas, where there currently exists no access to basic education for the Deaf,
let alone technical and vocational programs. It is vital that programs with an integrated approach to developing literacy
and technical and vocational skills be available to deaf youth, to prepare them to enter into the workforce and/or to initiate
microenterprise livelihood projects.

Siemens’ partnership with FESF in reaching the Deaf children of Pakistan, is helping to fill this gap.

The Schools and Training Centers presently provide academic (KG – 12th grade) and/or vocational skills training to over
1,000 deaf children and adolescents, 43% of whom are female.

Its programs are continually expanding to further empower marginalized urban and rural deaf youth, the majority of whom
are economically challenged, and to provide them with a brighter future.

22 Siemens Annual Report 2018

Support for The Citizens Foundation

The Citizens Foundation endeavors to bring about positive social change by providing quality education to children who
would otherwise not be able to attend school due to financial constraints. Siemens, again in 2018, provided support for the
initiative ‘Educate a Child – Transform a Life’ through TCF’s ‘Sponsor-a-Classroom’ program. Every child deserves an educa-
tion and a better chance in life and we hope this contribution helps provide the children a better opportunity in life.

Green Office Initiative in collaboration with WWF

Siemens partnered with WWF Pakistan for its Green Office

programme to address the environmental challenges and
learn ways to be instrumental in improving our environ-
ment. Green Office Program is a practical and simple Envi-
ronmental Management System specifically for office condi-
tions to reduce overall carbon emissions. Green Office is a
programme that will help us reduce our environmental foot-
print and in educating employees to be better and respon-
sible citizens and understand their civic and environmental
responsibilities.

The implementation of a Green Office will help Siemens cut

down on energy costs, reduce waste and make better pro-
curement choices.
Training and HR Development

Siemens plays an active role in developing human resource, by conducting industry specific vocational and professional
training programs. Siemens is an ACCA Approved Employer – Trainee Development, Gold, an approved Training Organiza-
tion Outside Practice of the Institute of Chartered Accountants of Pakistan and an approved employer of ICAEW.

Siemens Annual Report 2018 23